>> rose: welcome to the program. we begin this evening with a look at the question of chemical weapons in syria and start with a conversation with mike roger chairman of the house intelligence committee. >> you have this-- this horrible possibility that if assad falls and there is a huge vacuum and cass on ensues, that you have

hezbollah there, you have al qaeda, you have some hamas elements there, and you have lots of chemical weapons and lots of very sophisticated conventional weapons that will be up for grabs. and that chaos will cause huge problem for the middle east, for southern europe, and i argue, for the unit stat. member,hese are sophisticated weapons system would make libya look like an antique gun show when all of those weapons spread across north africa. dangerous, destabilizing stuff. >> rose: we continue with a an analysis from richard haas of council on foreign relations, and joshua landis of the university of oklahoma. >> desperate leaders might do desperate things if they felt there was no alternative. i don'i don't think we can prevent the use unless we thaten, i if they are used on

any significant scale, what do we do then? >> rose: we conclude with a look at the press conference pie the chairman of the federal reserve, ben bernanke. my guests alan blinder and david leonhardt. >> the most interesting part of the news conference was when bernanke was asked if he wanted to continue on in the job. his term expires in february, and although he refused to answer the question, he said he and president obama had spoken about it "a bit." i think it's interesting to think about the iea th a obama have talked about whether he wants a third term and perhaps how inclined obama is to give it to him. >> rose: a look at syria and chemical weapons. and also the bernanke conversation today about the economy and the role of the federal reserve when we continue.

captioning sponsored by rose communications from our studios in new york city, this is charlie rose. >> rose: the syrian conflict reached new levels this week. the assad regime and the syrian opposition groups accused of each other of using chemical weapons. the allegations were made only hours before president obama's departure to israel yesterday.

the white house has yet to verify the claims but lawmakers are increasingly calling for action. here's what presidentbama said eaier day in a joint press conference with israeli prime minister netanyahu. >> with respect to chemical weapons, we intend to investigate thoroughly exactly what happened. obviously, in syria right now, you've got a war zone. you have information that's filtered out. but we have to make sure that we know exactly what happened, what was nature of the incident, what can we document, what can we prove. i've instructed me teams to work closely witll oer countries in the region, and international organizations, and institutions to find out precisely whether or not this red line was crossed. i will note without at this point having all the facts before me, that we know the

syrian government has the capacity to carry out chemical weapon attacks. we know that there are those there the syrian government who have compressed a willingnesso e-- expressed a willingness to use chemical weapons if necessary, to protect themselves. i am deeply skeptical of any claim that in fact it was the opposition that used chemical weapons. everybody who knows the facts of the chemical weapon stockpiles inside of syria as well as the syrian government's capabilities i think would question those claims, but i know that they're floating o there right now. the broader point is that once we establish the facts, i have made clear that the use of chemical weapons is a game changer.

>> rose: joining me from washington, michigan congressman mike rogers, he is the chairman of the house intelligence committee. i am pleased to have him on this program. welcome. >> charlie, thanks for having me. >> rose: what is it that caused you to say, you know, there's a probability? >> well, there is a growing body of reporting for really about 18 mont out what we believe the syrian intention is, the fact-- the public reports that last year they brought in and put the weapons in a configuration that could be used on short notice, and i'm talking about chemical weapons now. and, clearly, the reports all along that there had been chemical weapons by the opposition, some we didn't find credible, but i just believe now, charlie, there's a body of evidence, a body of reporting, that leads me to believe as of yesterday that the syrians have inact throughout this conflict in a small number of times used some quantity of chemical

weapons. >> rose: but they have not used the level that would make the world community fearful of what could be extraordinarily damaging yet, obviously. >> yeah, i think that's right. and there's some debate about what level of chemical weapon may have been used in the case just recently. and that's a fair debate to have. here's my concern, though, is that given, again, this whole body of reporting over the las two years, that they have chemical weapons. i believe they have the intention to use them under the right circumstances, and i think that leads us to have to do something about at least disrupting the their capability to deliver those chemical weapons. we're talking about thousands of people, a horrible humanitarian crisis, and if we have the capability-- and i'm not talking about whole-scale war, boots on the grounds, none of that-- but

if we have the capability to disrupt i i thi we're obligated to the international community, certainly to our own national security interest, to prevent the use of a weapon of mass destruction, chemical weapon. >> rose: are you calling for an airstrike at this time? >> i think the united states has a whole series of capabilities, charlie, that other countries don't have. some they do. some they don't. it would be better in an international effort. but there are ways we could make it so they would not have the ability to deliver those weapon systems. and i would argue that we ought to pursue those capabilities at the uned states has, especially given the debate we're having today that high probability that chemical weapons have been used in the country of syria. this is probably the time, as the president called for that red line, this is the time we need to take action, if we're going to prevent needless civilian casualties. >> rose: you see, the reason you are more credible on this is

you're chairman house intelligence committee and you have access to information, the chair of the committee has access, i think, more than anyone else, and the president, obviously -- the president probably sees more information that you haven't seen. and they seem to be careful about this. and they're not wanting to take it to the next step. why is that? >> yeah, and i would dispute that the president sees more-- the president gets a daily briefing that's certainly narrowed down. and i don't have those same restrictions on the narrow down. so we have the opportunity get more broadly into these issues, and look at all of the reports as they come in. and i argue that's my job as chairman of the house intelligence committee to do that. >> rose: there's nothing the d.n.i. would tell the president that you wouldn't have seen as well? >> that's probably likely, yes. at least when it comes to this issue over the course last two years, i believe that's right and accurate. and i have the ability to follow up with other information and questions.

that being said, what i think you see happening now is that you have the israeli official who said that he believed chemical weapons were used. you have certainly dianne feinstein yesterday said there's a high obability. i have said there's aigh probability, based on a whole couple of years' worth of body of reports that i have seen. i mean, it's clearly, there's many of us who believe they've crossed that threshold. and i understand the president's reluctance to say today and would like it look at his options and i think he should do that. but at some point we need to-- we've all acknowledged he has those weapons. we've acknowledged now there's intent to be used, many across the intelligence communities believe they have used these weapons. you can't wait for a pile of corpses t dede that that's the evidence that you have to move forward. i think that's a disaster for us. and it's really concerning to me that-- this is the time we have a very short windy on here

i think to make a decision, and i'm encouraging the trot take action with the special capabilities that we have. >> rose: i'm just trying toinate this down. when you say they've been used, what are we talking about specifically and how serious was it and why wasn't there more discussion of it? >> yeah, i think-- and again this is over a whole body of-- i want to make clear whole body of report overs the last 18 months to two years. we believe that there were eye believe there were instances where small quantities of chemical weapons have been used, and i believe there's some validity to what has happened recently, and certainly they had intentions. certainly they had the capability. certainly they had the weapones, and i think they had the intention, and i do believe some quantity has been used. >> rose: and used with all the killing capacity of these chemical weapons? >> no-- year, that'she o argument i think-- not argument, but debate we're having amongst

ourselves about why to this snrefl why not use something bigger, stronger? and i think there's a whole series of reasons that could be, including, you know, the possibility of mishandling the weapon itself and trying to stay under the radar of international condemnation. i think all of those things are probably fact nors this. >> rose: do we have evidence that they have moved the chemical weapons? >> well, last summer, as was puicly reported, they had been moving chemical munitions from sites. the syrians publicly said that was to make them more secure, but we also know, according to public reportes, that they had configured the weapons -- their takeses some configuration in order to make them viable to be used as a chemical weapon in a missile, or other projectile. we think that, according to these public reportes, happened. >> rose: all right, so the russian foreign minister sat at

this table that i'm sitting at no as well as the russian ambassador to the united nations, and they have said to me they have communicated t to bar bashar assad that absolutely chemical weapons were not to be used. you have said there's a clear intend. what's between the two? >> well, you have to remember this is a regime that more isolateed in the international community. they do have iran and russia on each shoulder trying to prop them up, but at some point, that presre i put on senior officers, midlevel officers, this unit that handles chemical weapons. and so there's some debate in the intelligence community if assad has complete and full control or if he has expressed the use to use everything that we have to stop the rebels and that is interpreted somewhere down that chain of command, well, we have chemical weapons, let's use those. and there is some debate that

they look at it just as a weapon, any other weapon they would use to either square territory and/or-- square territory and/or disrupt and certainly hurt the moral of the rebels doing the fighting. we, all o think all of those combination of details is going on. we have to decide if there's a red line what, do we do now. >> rose: one more question about that. is there any evidence that you have seen from u.s. sources, or anywhere else, that bashar assad has said or communitied that he would in fact at some point be willing to use chemical weapons? >> i can't talk about any specific source of information. i can tell you that over a long body of reporting, i have come to the conclusion that they have the intent to use chemical

weapons under the right circumstances, and that's what's so concerning. >> rose: what are the right circumstances? >> well, we don't know. again, the regime is under pressure. and ther there is, again, some debateif tre is some interpretation what that means even among themselves. but again, they have them. they have configured them. they have fired scud missiles before and i believe they have the intent to use them if they believe that will help their end game of defeating the rebels. >> rose: your advice to the president is what? >> if you issue a red line for our allies and our adversaries, it can't be a pink line. can't be a dotted line. it can't be an imaginary line. it has to be a red line. and that's alwayshe dger in issuing red line statements. but newt more important than ever. the opposition is clearly watching. and wondering. i think our allies in the region, who are really angry with the united states about their lack of participation, and

i'm not just talking about military, but in the whole sense of being i center of influence for an outcome in syria, they're pretty frustrated. it tells me that at the very least, we need to take action to disrupt their ability to deliver chemical weapons. i don't want to be on the wrong side of that. i don't want the president to be on the wrong side of it. i don't want the united states to be on the wrong si of th, for our own national security, as well as the humanitarian issue of having this massive chemical weapon go off and kill just thousands of civilians. >> rose: so what is the response if that fact happens, if chemical weapons go off, and they go past the red line and they do it before the administration has acted? what is our response then? >> i think that's a whole different discussion. i still think you'd have to at the bare minimum disrupt their ability to deliver any further munitions. and then i think we would have to have a long, sobering conversation about what would come next. i can tell you this, charlie, i

did call for-- this thing is going bad. people are probably wondering why is there a national security interest here, and why are we see eager-- clearly people under the moral obligation, but what about the broader national security interest to the united states? right now, we're in a horrible spot. you have the opposition who has lost faith in the united states. they even at one time denied a meeting with the secretary of state of the united states. that's not a good sign. then you have our allies in the region, the arabeague, rely frustrated with the united states, don't think we're doing enough. that means that our any diplomatic solution-- and i'm for a diplomatic solution-- we have no credibility to do it. you have this horrible possibility that if assad falls and there is a huge vacuum and chaos ensues, that you have hezbollah there. you have akd. al qaeda. you have some hamas elements there and you have lots of chemical weapons and lots of very sophisticate conventional

weapons that will bep for grs. and that chaos will cause huge trouble for the middle east, for southern europe, and i argue for the united states. remember, these are sophisticated weapon systems, would make libya look like an antique gun show when all of those weapons spread across north africa, really dangerous, destabilizing stuff. all of these things have to happen at the same time. i would like to see a safe zone with a no-fly zone so you can train and vet soldiers who ve u.s. training to reengage in the battlefield, and prevent the use of those scud missiles. we have the capability t to do all of that. no big boots on the ground. no major military involvement, i think at the end of the day it would service our purpose. >> rose: i think you know there is a debate whether you can do this without boots on the ground. clearly, there are military possibilities of using air power here, but there are many who question whether you can do it

and safely coral those chemical weapons without boots on the ground, coming from somewhere. >> well, here's thedifference. if y're talkingbout tryin to provide a platform for reasserting our credibility with the opposition and our allies-- remember, our allies in there, but it's a little bit confusing about who is getting weapons and why they're getting weapons. now you have all of these bad actors there. we all agree on that. this would be that interim step. it would be the ability to take information, train them to u.s. standards in a very quick way. equip them with the right kind of equipment to get back into the fight so we regain and establish that sport from opposition. when this falls, we're going to snead opposition folks to help us square these weapon system. not as the pentagon would tell you, 70,000 troops. that would be a mistake. i wouldn't be for that. in order for that not to happen we have to immediately go in and

try to square the confidence of these opposition forces and do it in a way that protects u.s. national security interests. you don't want to arm the bad guys. but we do want to have some influence when this is over so that they can help us secure both conventional and chemical weapon stockpiles. q. when history looks back atwhe do not know the end yet-- but when history looks back is it possible they will say if the united states had come in early on the side of the rebels, we might have had a different circumstance because now it's changed, and the timeline is different because so many people who are not friends of the united states have come in on the side of the rebels? >> i think that's right. i really do. unfortunately so. because what happened is-- and in any event-- we saw this in northern mali. when they getuccs, they use that as a recruiting tool-- and i'm talk about they, al qaeda and those types of groups. well elnusra came in.

the best-trained fighters, the best equipped fighters and most committed fighters. you have relatively secular opposition forces who were engaging and embracing these folks because it was really the best chance they had, especially in tough fighting. and so once those successes started to happen, it got worse. it inflamed. so huhezbollah coming inrom the north. they're florida getting a hold of these weapons and they have their interest in supporting the alo alaloites. i believe there are some elementes of hamas looking for certain weapons systems they can get their hands on, all at the same time. and the void and the vacuum was u.s. leadership. it just wasn't there. and that's what our allies will tell us, the arab league allies who are trying to do something about this. now is a chance to try to repair some of the damage, and position ourselves to be in a better tcome whenssad does go-- and he's going to go. we just don't know when.

>> rose: if you looked tat today, apart from the chemical weapon debate, what's the win component. >> the win component to me-- if you look at our national security interest-- is to make sure all of those sophisticate weapons system stay there. and that chemical weapons as well. candidly, charlie-- and i've come a long way on this-- i argued, listen, if we want a diplomatic solution, the russians will probably have to be a part of that. they're the one folks that culd walk into e ro with asd and say, "come on. you're coming with me. this thing is over." and not have a chaotic breakdown. a fundamental chaotic society breakdown that costs us any chance of securing weapons systems. i think that ought to be the number one priority of the united states going into this now. saving those lives and securing those weapon systems so we don't have a bigger, broader problem that costs more lives, huge humanitarian crisis-- imagine the refugees fleeing in all dekes the doomsday scenario of

this is real, and quite concerning. this other alternative i talk about is really to me the best possible outcome so that you have syrians and arab league soldiers helping secure the sites that we're concerned about, and some interim government that doesn't brick chaos so you still have police forces. you still have some sense of security, which is really critical. that to me would be best possible outcome at this stage of the fight. and we're not ready for that to happen yet, candidly. >> rose: when i went to see king of jordan, where the president is going it see him in a day or two, one of the things he said to me at that time was the key to this was the alites, and the expuz russians have to convince them, convince them that this is not a fight to the end. because that's what they fear that they will be wiped out. >> clearly. and who fans that flame but iran. the aloites are a shiite sect closer to iran than they are to

the sunnis. and so hezbollah has been working on that psychological effort. iran is working on that psychological effort. and they're fanning the flames. really, the aloites have been the main fighting force and most loyal troops that assad has. and part of that is because they do passionately believe that if they lose, they get literally wiped out, that there will be retribution killings and it will be awful. that's why some are arguing, well, they're trying to build an enclave in the north. >> rose: right, right. >> so when assad goes they all go to the north and hunker down for a fight and moving weapon systems that would allow them to sustain that all of those things are concerning. that's why i think there's a diplomatic solution that could go in with the russians and let them understand we'll protect the aloites just as we will anyone else in the country, as long as we get no chaos in the process. now, you won't be able to stop it all, but in the perfect

outcome, that diplomatic solution-- and again, in order to get there you have to have the credibility of the opposition, credibility of the arab league, which we do not have today-- that would be the best outcome. and tough outcome at that, because the aloites are goingto stilbe very hard to convince that they don't have to fight to the bitter end. >> rose: how do you convince the russians to do this? >> they see that the united states would have influence, assad leaving, which is their toe hold in the middle east. and that's one of their concerns. they have a strategic concern in their mind.

i would argue they have a 10-year lease, maybe part of that negotiation is to allow them to keep that 10-year lease, and then this next syrian government could negotiate what happens next at the end of 10 years. you know, i think they have to have something to save face. if they could be seen as part of the arrangement where assad peacefully leaves the country and everything is stood down. that would be i think equally important part conversation. the russians aren't there yet. don't get me wrong. mainly because i think they think this is a long, protracted fight and in their mind, that benefits them. if we can show them this is not a long, protract fight and they're going to be on the wrong side of history here, we might get them motivated to help us in a diplomatic way. >> rose: they are unhappy the way libya unfolded. >> they look at it as t united ates had a regime change, if you will-- this is the russian

perspective-- in libya. that wasn't good for them. they don't want to see another one in syria. you know, they do have a pretty good cache weapons system in syria that they don't want to lose, either. and strange alliance with iran. they're talking about enriching their uranium, and bringing it in and all those kind of things. the russians are up to no good, but i think we can get them to a place where i think it's in their best interest, that would be a diplomatic coup, i think. that's the one place they have almost absolute treatment of movement-- at least before the civil war-- they could do what they need. they were an integral part of training the syrian military on their weapons systems. it's quite a coup for them to have that, especially in that pretty tough neighborhood. they would lose that in their mind and that's worst of all outcomes and that's why i think we've got to convince them this thing isn't going to last must

have longer. you're on the wrong side of chemical weapons. you'll have that stain on your international reputation if you let this go forward, this might be the time to convince them we're in the right spot. >> rose: mike rogers, thank you so much. it's good to have you on this program and have a real conversation. >> thank you for having a real conversation. it doesn't happy much in the news business anymore, thank you. > you. we continue our discussion on syria. joining me from washington, richard haas, president of the council on foreign relations. from northern oakula home, joshua landis at the university of oklahoma. >> there's some refugee flows are significant now out of the country. this is awful by whatever

measure you have. humanitarian or strategic. there's no bright dimension, i'm sad to say. >> rose: if in fact there was a significant involvement on the part of the united states and others, yondhat theyav now, to supply arms to the rebels, would it bring an end to the conflict? >> look, if the united states were to selectively arm the opposition-- by selective i mean certain kind of arms, certain antitank or anti-aircraft system,s to the measures of the opposition we had some confidence in what their agenda is, i believe it would help. i favor doing that. but there is no silver bullet here in any literal or figurative sense. gradually, that wouldhelp psyclogically as well as militarily, you'd probably see greater numbers of des techs happening. but it's not going to be, if you will, a tipping point where suddenly the regime is going to disappear in a hurry because the united states is sending in, for example, some stingers or later day equivalents.

>> rose equivalent. >> well, you know, unfortunately this colonof conflict has taken on a sectarian dimension. the aloitis dominate and they have nowhere to go but down. they're going to be cast out of their high perch in this syrian government down to the bottom of society, in the same way the sunnies in iraq were cast down when america invaded, catapulted the shiites to the top, and the sunnis became-- joined al qaeda and became desperate. and they're still blowing things up today in iraq because they want their hunk of the country back. and, unfortunately, the aloites, who've dominated the and the security apparatus, are headed towards the bottom of society. they'll be marginalized, probably. we don't know at will ppen them. so they're fighting tooth and nail. america can put in more weapons, and turn the tables on this state. we've got a static situation as

richard haas has said, where there's a stalemate. syria's losing-- the government is losing hunchgz of territory, particularly in the north and east. it's lost most of the east, and about half of aleppo, the major city in the north. but it still has a strong perch in damascus. we're at a stalemate. the american government, europeans could changehat stalatedramically by injecting new weapons. the trouble is political plea, for president obama, there is only down sides to this, at least in the short term. if the rebeles, who are very fragmented and there are elements of antibody i al qaedas in there, get the weapons obama would send in, they could use them against israels and allies of the united states. when obama looks at this politically, he sees a big steep downside, and not very much upside about getting america involved. he's much more interestedn e middle class in america than he is in the middle east.

he's trying to get out of the middle east, not into it. >> rose: i understand that, but what do you think israel would want the president to do? >> what israel wants is to limit the amount of powerful weapons that syria has. we've seen them attack already missiles that they believe were going to hezbollah. they've attacked a nuclear plant in 2007. israel wants to get rid of all advanced weapons in syria. so when-- if obama were to send in more advanced weapons to the rebels, ihink this would make israelis nervous. and that's one of the constraints that i think weighs on him in his deliberations about whether to get more deeply involved in the situation. >> could i just go back and contradict or challenge one or two assertions. i don't think it's a big problem for president obama to start sending arms to the opposition. if anything, he may have reached a point where it's a bigger problem if he doesn't. it's a hard position to say we're not going get involved this against the backdrop of

nocide and the strategic-- it's hard for the president to argue he's going to do nothing. i actually think it's the less difficult path, and i think it's a question of when not if the administration moves in that direction. we've been creeping towards it, various forms of nonlethal aid-- quote, unquote. this is going to happen. secondly, the israelis, yes, they're corporated about weapons going into syria. they're more concerned, quite honestly bweapons coming out of syria, and they're worried about weapons going into lebanon, reaching he hezbollah, reaching hamas. th israeli don hav any great options in there. when the crise began, many where willies seemed to favor the status quo, the rescream, and afterwards there seemed to be some term. at the moment they're probably worried not about the exodus of weapons but the instability the syrian crisis is causing for jordan, one of the two arab countries that has a peace treaty with israel and the rells

are increasingly worried the throne on which king abdullah sits is getting increasingly shaky. what the israelis want is for this to end sooner rather than late andif that would mean the president sitting on his hands, they would favor that. if that meant sending in more arms, they would favor that. they want to go back, if you will, some version of what existed, which was no peace, no war, but at least stability on its northern border with syria. >> rose: let me make sure i understand what you're saying, both of you. if the president o wanted to end this conflict he would do so by sending in arms and he does not have to put boots on ground. >> i'm not saying that charlie. i don't think that would necearilend ings. it would perhaps favor the military balance on the opposition. on the other hand, the iranians and russians might continue putting stuff in, and you could have a situation where-- quote, unquote it's government falls but a sectarian war continues. indeed, i think that's now the

more likely scenario, where you have long sectarian fighting some kind of civil war where the aloites, even though they've lost effective national control are tile continue some sort of law. mr. landis used the example before, and i thi it is rht onwhat we saw in iraq where you had for years various sunni group continue to take the battle against the shi'a forces. >> rose: joshua, would you contradict what richard said? >> the big danger for obama is you're not going to end the civil war by destroying the syrian state. there are over 1,000 militias in the opposition. some of them are al qaeda connected. the islamic front, which leans in that direction, is perhaps the most powerful collection of militias. and then there are other militias that we're trying to cuivate and ve r aid to which are more liberal islamist militias. so-- and the danger is all these militias are sharing arms. they're working together.

so if you give arms to your militia, you can't guarantee that they're not going to be shared with the more-- other islamic front militias. and that's problem. we haven't been able to just give arms to our militias, for example, and say-- and have them stay there. they have gone right from one end of the militia spectrum to the other. that's the dange and they're goingo ultimately these different militias are going to have to duke it out on who is going to be the top dog in syria. it's likely going to be a patchwork security system once this is over. and as richard haas said, there will be a sectarian element. the aloites are not going away. they're almost three million syrians. and unless you-- if america tips the balance too much in favor of a sunni win in order to eliminate iranian influence and to hurt the assad government, you kul cou get the aloites storming into lebanon, being

ethnically cleansed. if islamic militias move into their territory, the western coast of sirria, they could all leave. and you would get another sort of palestinian problem in the same way that the jewish win in israel was so big in '48. all the palestinians left-- not all, but a big hunk of them-- and they destabilized the middle east for decades to come. the stakes are very high for destabilization, whether assad wins or loses. and that's the difficulty. rose: i want to go to chemical weapons, but there's one idea often float which would is we need some kind of big power conference to come in and the russia and the united states other ands. does that have any possibility? >> we're past an era where the great powers can somehow meet in paris or whatever, and dictate future of the middle east. the gap between whatever power they may have on paper and the power they're prepared or able to bring to bear against the resilience of local forces is

enormous. we're a century past e kis ofgreements which divided up the middle east after world war i. even if the united states and russian were to agree, it might hasteep the demise of this regime, but it's not going to hasten the emergence of peace or the end of sectarian warfare in syria. we're way past that. what it would take is some enormous peacekeeping force with great capable and great endurance, and we're talking about potentially years of presence, whether from the middle east or from turkey, but also, you have to remember, any one of these kinds of forces is going to have an agenda o a bi, so there would as you be people in the country who are going to fight back. i just don't think at the moment words like "solution" or "peace" or "settlement" ought to be part conversation. >> rose: do you disagree with na, joshua? >> no, i agree with that. this is an et cetera nick and sectarian war. in israel, palestine, the u.s.

has not been able to broker peace between palestinianians and jews. in iraq, we failed. in lebanon we haven't been able to broker a negotiated solution between hezbollah and the christians that is to america's liking. and in syria, between aloites and sunnis, america cannot solve this problem. this is a national identity problem of people living together. >> rose: joshua, you have made siriat subject and study of your life. when you look at chemical weapons and this discussion that we're having now, do you believe that the government has in any way used chemical weapons or has plans to? >> you know, i don't know if they've used them. the u.s. is saying they haven't. israel is saying they have. israel says yes they have. it's possible that, you know, small-- about 20, 30 people killed in this ibs dent in aleppo. we're unsure of the outcome. but syria has a lot of chemical

weapons. if the aloiteites are pushed to the wall-- which they may be-- they're likely to use them. and particularly if they know that this is a red line for american involvement. right now, assad stillomines the syrian government. he knows that using chemical weapons is going to trigger american-- could trigger american intervention. he does not want to do it now. he does not want american intervention. but if he's driven out of damascus and up against the wall in the west of syria and looks like he's going to fail, he might very well use them, especially if he thinks it would trigger american involvement because america could be his last line of defense and last protection against something mu worse. >> i han't seen any hard evidence that they've been used. there have been some reports, and if they were used it seems to have been on an extremely small scale. but again, i think there's no

hard evidence. might they be used? sure, desperate leaders might do desperate things if they felt there was no alternative. i don't think there's anything we can do to prevent their use, other than to threaten, as we have, if they were to be used it would cross a-- quote, unquote-- red line and have dire consequences. the real question is if they are used on any significant sale what do w d the from what i can tell, there are large stocks disbursed on any number of missiles and arcraft so in order to prevent continued use you'd really have to take out an enormous chunk of the syrian military. that's a euphemism for going to war. it's an extraordinarily difficult scenario. one question, charlie, which i don't have an answer to is if the syrians were to use chemical weapons in a meaningful way, how would the russians react? up till now they have given the syrians considerable support. might that be the straw that breaks the camel's back -- >> rose: and bring the russians in to do something. i have to close it there.

i'm sorry, i have to close it there. back in a moment, stay with us. the federal reserve concluded a two life day meeting today. it affirmed to to it be with quantitative easing and near 0 interest rate. here is what ben bernanke said this afternoon: >> overall, still high unemployment in combination with relativenflation, underscores the need for policies that will support progress towards maximum employment in a context of price stability. . >> rose: joining me is alan blinder of princeton university, the author of "after the music stops, the financial crisis, the response and the work ahead." and david leonhardt, author of "here's the deal: how washington can solve the deficit and spur growth."

i am pleased to have them both on the program. what's the headline coming out of bernke's press conrence? >> i think steady as it goes is the main headline. the fed is going to continue to buy these bonds it has been buying at about the same pace. it's going to continue doing it until sees unemployment fall to about 6.5%. i don't think there are any changed today. i think the most interesting part of the news conference was when bernanke wanted to stay on in the job. although he refused to answer the question he said he and president obama had spokeeb about it "a bit." ihink it's intesng to think about the idea he and obama have talked about whether he wants a third term and how inclined obama is to give it to him. >> rose: i would think if obama is talking to him about it it suggests will obama would like for him to continue. >> i think that's a good assumption. i think obama clearly likes bernanke and thinks on the whole bernanke has done a good job. he has made the same mistake

obama has made, which is you want estimating the depth and length of this weak economy. in some ways the strongest argument for obama to replace him is a partisan argument. there have bn republicans this job now for more than 20 years. and i think democrats may not want the fed chairman job to be something that is seen as a republican job. now, bernanke is, of course, being criticized much more by republicans than democrats will at this point but he still is originally a republican, there are some, geithner, and summers, and including in blinder who would be serious candidates if persh key were to leave. >> rose: your thought, sir? the scuttlebutt from everybody is that he'll probably have snufafteeight years. i do believe that if he wants a third term and he asked the president for it, he'd probably get it for the reasons david said. he's done a very good-- never mind personal, never mind republican. he's just done a very good job. as david said, he's got

republicans a lot angrier than teams, even though he came into this job as a bush appointee from the republican side. so i think if bernanke is an eight-year chairman, it will be of his soleition, rather than obama saying -- his volition, rather than obama saying it's time for you to go and put in a democrat. >> rose: has he made decisions you disagreed with? >> yes, i disagreed very fundamentally with the lehman brothers decision. it wasn't the cause of the crisis, we had the crisis before, but it was a turning point and everything fell apart. >> rose: what's their answer to that question. >> the answer has changed a few times but the basic answer is we department have the legal means. there was no tarp. the was no dodd-frank. they now have the legal means to handle the next lehman, so to speak, differently. but his view was that they

didn't have the legal means to do it. >> the problem with that answer is they dnt have the legal means to do some of the things they actually did do and when they really wanted to to do it they found the legal means so i think that answer from them is not fully satisfying. it's not completely unreasonable. >> rose: what's his theory of the case of the economy today and what's necessary to bring down unemployment? he seems to meo he mad unemployment his principal target. >> yes. i think the theory of the case is largely two pieces. one, to the point you were just making, charlie, the felled is given by congress a dual mandate, two responsibilities -- keep inflation low, keep unemployment low. it's getting a-plus on keeping inflation low. it's getting d-minus on keep unemployment low. that's a big piece of his case. that's why we need to concentrate on getsing the unemployment rate lower than it is. second part of the case is-- and you alluded to ts before with

david-- that this economy seems plagued with chronic weakness. every time it seems to be getting off its knees, something else happens. by the way, the something else that is happening now is fiscal restraint, austerity if you want to use that word. i thought the most interesting thing in the statement was an added clause about how fiscal policy is becoming more restrictive, which is a true statement. and i think he's now-- that's one of the head winds that bernanke and the fed majority are fighting, ironically, our own government >> rose: david? >> that's absolutely true. and the comparison to prior decade is really striking. we ran a charred chart in the "times" several weeks back in which we compared government employment after this recession to government employment under previous recessiones, under reagan, and h.w. bush, and clinton. the difference is probably 1 million jobs relative to what is

done in the past and now. we're missing one million government jobs retive to the histical norm -- >> rose: what's the difference? why is that true? >> it's true for two reasons. one is that states and locates almost inevitability have to cut back when time is tough. they lose tax revenues. they are mandated legally to run a balanced budget so at the time same time consumers and red soxes pull back the government is. in washington, starting in 2011, with the negotiations between the house republicans and the white houses, the house republicans have insisted on big cuts and have woniguts and that's why we have austerity and will have more this year. >> rose: if the fed wanted to reduce unemployment from seven to whatever it is-- seven. could they do that? do they have the tools to do that? >> no. i don't think so. they're down to incremental policies. i think they know that. ben bernanke and janet yellen,

and otheres, are constantly arguing-- correct, i think-- but they tend to put the best face on it as they can, we still have effective policy instruments, we can stillgivehecony a boost. but you're talking in the desmalplace of the growth rate. there is nothing left in the fed's arsenal, i don't think that could as a half a point to the growth rate. that's not that much to. in the days, when the fed had a much fuller arsenal and it wasn't decompleted. >> rose: are you surprised i have had smart people here say it will be a long time before the u.s. economy gets back at a 4% growth rate? >> no, i'm not surprised weaw no sensof that-- at the very beginning of the recovery we got to some 4% numbers. we even hit a five but it got revised down. but it didn't last long, and frankly, we've had very few quarters since the early stages

of this recovery that had a 3 evennals the first digit, never mind a four. so four looks like a big stretch, but you're right to use a number like that. in previous overseases, beating four-- recoveries beating four was considered a piece of cake. >> rose: what's hapningn e stk market, david? >> yeah, it's doing very nicely. a few things are happening. one, the corporate sector continues to do pretty well. even though g.d.p. growth has been mediocre, a large portion of that g.d.p. growth is going to the corporate sector instead of work fers a whole variety reasons. so that translates into pretty good corporate profits which in turn translates into good stock prices. the other thing is interest rates are so low by design people are willing to take risks and put their money in the stock market. do have e stk market doing really well. that translates to some significant number of americans who own substantial amounts of stock.

but it doesn't translate to everyone. and i think there's a real question about whether it-- how long it can go on, because stock bryces are not cheap right now, relative to long-term corporate earnings. >> rose: with respect to the sequester and all that's gone on down in washington, is that going to have an effect on the economy? >> oh, yeah. i think it's already having an effect. it's not a gegantic effect it's estimates at came outf the c.b.o., endorsed by ben bernanke, just the sequester would lop half a point off the growth rate. it's not by accident a minute ago i used a half a point as a metric. in normal times the fed would have put that back. congress took half a point off the growth rate. we'll put it back. i don't think they can do that. the sequester is not the whole thing. the budget control act is pulling spending down as david indicated a while ago. we had a tax increase in january as part new year's day agreement. part of-- the part that got the

most publicity was the tax on the so-called rich, but in addition to that, the payroll tax reverted to its norm. that's 2% of payroll for every single working american. that's not a trivial amount of what in the old days we would have called fiscal cracks. and i think we still should call it fiscal cracks. i think that' contraction. that's why i think this year is more likely to be a 2%-plus growth year than a 3%-plus owth year, never min the four that you asked about before. you've got the housing really starting to bubble. -- well, i shouldn't use that word. scratch that. starting to come back. you've got business investment doing very nicely, thank you. you've got consumer sort of -- >> rose: business investment is doing so nicely, thank you, why isn't unemployment coming down? >> they're hiring equipment instead of hiring working. i just saw something-- i don't know if it was in david's

newspaper or other one-- housing starts up are 27% but construction employment is up, like, 2.5%. they're doing it without a let more people. they're doing it with machinery. they're stretching their existing labor, and things like that. there's a great imbalance between the expansion in at least parts of the business sector, and the expansion of employment. >> rose: david let me shift because people are talking about it, including your paper, cypress. is that going to have cons sense? >> it's always hard to know with anything market based because it's hard to know exactly how it affection confidence and all kinds of things. alan mention lehman before. lehman, obviously, had an effect vastly larger than its size relative to the economy. chairman bernanke moqtada al-sadr, look, cyprus has a larger banking system than it does an economy, and that's one of the reasons to worry about it. but still, its a tiny, tiny little country. and so i think the best guess

is that cyprus will not be some kind of turning point in the way greece was a few years ago. it's not likely to be some kind of ctagion. but whenou he an economy still as weak as ourselves and in many ways is hobbled as ours, there's reason for concern. you talked about the stock market before. the financial associate is substantially stocker than it was a few years ago and that's part of the reason why i think the most likely scenario is cyprus will be a little brit blip. it's not out of the question theret will be more than that. >> rose: people have raised as well the idea of going in and charging depositors, even those below 100,000 euro, did that really send arms through baing comnity, david? >> i think it's hard ton -- >> rose: it's vetoed, obviously, by the legislature and parliament. >> you know, we're in this funny situation in which we have this financial sector that historically, in this country and in some other places, is

really big, relative to the size of the economy. and so it doesn't seem like that has brought huge economic benefits. in fact, bernanke was asked about that todayes, and he confessed to being stumped. he didn't want to engage with the question of whether wall street was good or not for the economy. and te our also need to be a little concerned if we take measures to restrain the size of the financial sector, will that do even more damage? and that tension is at the heart of a lot of these debates. >> rose: david leonhardt, thank you, pleasure. >> thank you, charlie. >> rose: blierk thank you. >> thank you, charlie. >> i think your colleagues at princeton would let you know. >> in advance? i don't think so. ( laughter ) i don't think so. in fact, a bunch of professors is the last group you want to tell in advance. >>ose: beuse they can't keep a secret? >> exactly. 2